The Supermarket Sector’s Cage-Free Future

When I first began working with grocery chains to improve animal treatment in their supply systems, one thing I recall suggesting was that they begin to offer cage-free eggs on their shelves—something many companies weren’t doing. Fast forward a decade and a half and much of the industry is now in a race-to-the-top on this issue, with major companies now moving to ensure the only eggs on their shelves are cage-free.

Target recently announced, for example, that it will source 100% of its eggs from cage-free chickens by 2025. BJ’s Wholesale announced that it’ll switch to 100% cage-free eggs by 2022. The moves echo similar announcements from Costco, McDonald’s, Kellogg’s, General Mills, Unilever, Mondelez, Burger King, Starbucks, Aramark, Sodexo and dozens more.

It’s a shift that comes as American consumers ask more questions about how their food is produced—especially with regard to animal treatment.

“Shoppers want food retailers to prioritize animal welfare [even] over environmentally-sustainable practices,” reports the Food Marketing Institute, the supermarket sector’s largest trade association. “Animal welfare must now therefore be considered as a shopper value that retailers need to manage towards.”

And it’s not just something that retailers are managing: the country’s largest egg suppliers are also now addressing this issue by making cage-free announcements of their own. Cage-free is “the future of our industry and our business,”announcedHickman’s Family Farms—a major Arizona-based egg producer—last fall. As well, Rose Acre Farms, America’s second-largest egg producer—as well as Michael Foods and Rembrandt Foods—the country’s top two processed egg suppliers—have also committed to cage-free production. “With a reasonable timeline, we can meet any demand, and we’re eager to move our clients into the cage-free future,” saysRembrandt.

Even Wall Street is taking notice. Interest in companies’ performance on animal welfare, while once relegated to the likes of socially-responsible investment funds, is now taking root amongst mainstream firms.

In September, BlackRock, the world’s largest asset manager, hosted an event at its New York City headquarters on the topic, titled The Humane Economy. There, leaders from financial firms representing $17 trillion in combined assets-under-management gathered to discuss the material risks associated with animal cruelty in the food supply, and financial opportunities associated with embracing issues like shifting to cage-free eggs.

This interest from the world’s largest financiers makes sense. While the issue may be an ethical one for consumers, for financial firms, it’s a question of maximizing returns. Citigroup reports, for example, that animal cruelty is a “headline risk” to food companies, while the World Bank’s International Finance Corp. reports that it can “put companies and their investors at a competitive disadvantage.”

It may be that disadvantage that’s caused the food industry to progress a long way since the days when the idea of purchasing products with animal welfare in mind caused confusion. Nowadays, investors are taking into account how the companies they hold treat animals, and many of the world’s largest corporations are aggressively tackling the issue—moving chickens out of cages, for example, to show their customers and investors that it’s possible to both sell products at a value while also aligning those products with consumers’ values.

Matthew Prescott is senior food policy director for The Humane Society of the United States. On the web at www.MatthewPrescott.com.